Summary: Hi-Lo tracks the ratio of high to low cards left in the shoe and converts it into a betting signal. It is legal, it is difficult, and, critically, it does not apply to RNG blackjack online.
Step 1. Assign values to every card you see:
2, 3, 4, 5, 6 = +1 (low cards leaving the shoe favour the player)
7, 8, 9 = 0 (neutral)
10, J, Q, K, A = −1 (high cards leaving the shoe reduce player advantage)
Step 2. Maintain the running count. Start at zero and add each card's value as it appears. A positive running count means the remaining shoe is rich in tens and aces, which favours the player: more naturals at 3:2, more dealer busts. A negative count favours the house.
Step 3. Convert to the true count. The running count means nothing without knowing how much shoe is left.
True count = running count ÷ decks remaining in the shoe
A running count of +6 with six decks left is a true count of +1, barely anything. That same +6 with two decks left is +3, a genuinely favourable shoe.
Step 4. Adjust bet size. At a true count of +2 or higher the edge tilts toward the player, and stake size rises roughly in proportion to the true count. At neutral or negative counts, bet the minimum.
Where counting does and does not work. In RNG blackjack online, counting is worthless. The virtual deck is effectively reshuffled before each round, so no information carries forward. It is only theoretically applicable at live dealer tables using a physical shoe, and even there continuous shuffling machines, shallow penetration, low tolerance for a big betting spread, and active monitoring make it impractical for casual players. Counting is not illegal in Canada. Operators, though, are free to restrict or close accounts, and they do.